Emmanuel Macron says the EU needs reform in 2017
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After French fury boiled over the Brexit fishing restrictions, France’s Europe Minster Michel Barnier said Paris could “put pressure” on the UK by restricting UK energy supplies. But France appears to be facing its own crisis after analysis by The Economist showed gas prices soared 48 percent in September. And things do not appear to have improved.
Ole Hansen, head of commodity strategy at Saxobank, pointed out in a Twitter post that “EU gas rose 24 percent yesterday and is now up 30% since China’s order to secure supplies at all costs.”
Paris has sounded the alarm, calling on the EU to reduce this dependency on foreign energy.
French Finance Minister Bruno Le Maire told reporters last week: “It is crucial to diversify energy supply and reduce European dependency on gas-exporting countries as fast as possible.
“We don’t want to be dependent on the supplies coming from foreign [countries].”
Mr Le Maire has called on the EU to copy the French way, where nuclear energy accounts for a large part of the market.
He said: “Thanks to the French model we have more independence.”
And while France claims Britain is dependent on their energy supplies, evidence shows that the EU gets the majority of its natural gas supplies from Russia.
In 2020, Moscow accounted 43.3 percent of the EU’s natural gas stock, followed by Norway at 20 percent.
Britain also exports Russian pipeline gas via the Netherlands but is expected to feel much lighter effects from Mr Putin’s squeeze.
Norway, which is not a member state of the EU, is the main supplier of both crude oil and natural gas for the UK.
READ MORE: France threatens millions of Britons with energy blackout
In 2020, some 11.7 million metric tonnes of crude oil and 1.4 million metric tonnes of natural gas were imported from Norway.
The European Commission is looking into complaints by some EU countries that Russia is using its position as a major supplier to propel the soaring price of gas in Europe, the bloc’s energy policy chief said on Tuesday.
This comes after Gazprom, the state-owned Russian gas company that has been responsible for a tightening of European gas supplies, cut gas travelling into the EU via Belarus by 70 percent.
Exports to the EU via Belarus went down from 112 million cubic metres (mcm) on September 26 to just 30mcm on Sunday, according to data from Gazprom.
Deliveries from Russia and via Belarus to neighbouring Ukraine also dropped from 110mcm to 85mcm at the same time.
This move comes as Vladimir Putin, the Russian president, awaits approval from German regulators for a new pipeline that will transport gas into Europe.
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But the UK could have a way to manoeuvre out of the gas crisis,
On Tuesday, wind power was contributing about 30 percent of the nation’s electricity mix, a proportion slightly higher than gas, according to the National Grid.
Yesterday also marked the start of the North Sea Link’s operation, the world’s largest under-sea electricity cable that transfers green power between Norway and the UK.
It allows renewable power can be exported from the UK when wind generation is high and electricity demand low, or be imported from Norway when demand is high and wind generation low.
This will reduce UK dependency on gas and other foreign energy, and may help the UK dodge the crisis.
The Nord Stream 2 will travel from Russia into Germany through the Baltic Sea, bypassing Poland and Ukraine, agreed in a deal struck up by Mr Putin and the soon to be former German Chancellor Angela Merkel.
But Mr Putin is hoping to avoid EU rule applying to the system and has cut gas in what his critics say is a geopolitical move.
A group of EU lawmakers are now questioning the pipeline’s compliance with the bloc’s laws.
Polish politician Jerzy Buzek, said: “We cannot agree on any solutions that would circumvent EU law putting energy security of the Union in danger.
“The EU shall never compromise its law towards a third country.”
EU Parliament members wrote in a letter to EU Energy Commissioner Kadri Simson stating that the bloc should adopt interim measures against Gazprom the pipeline operates before getting the necessary approval.
They said that under the current structure, granting Gazprom approval as an operator puts even more risk on European energy supplies.
But Mr Putin claims he is not the one hiking up energy prices, blaming the transition to green energy and low investment in the extraction industries for the “hysteria and some confusion” around surging European gas markets.
The Russian president told his government in a meeting last week: “You see what is happening in Europe. There is hysteria and some confusion in the markets. Why? Because no one is taking it seriously.
“Some people are speculating on climate change issues, some people are underestimating some things, some are starting to cut back on investments in the extractive industries. There needs to be a smooth transition.”
The UK is not immune from the squeeze, either.
In October, gas prices in the UK surged by more than a fifth to new all-time high as the crisis continued to deepen.
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